Pledge of Allegiance

In the series-ending episode of Murder, She Wrote, star Angela
Lansbury and the writers of the show played out their swan song
with a hint of bitter irony in an episode titled "Death by
Demographics." The plot, which revolved around a murder at a radio
station seeking to draw a younger audience, was a thinly veiled dig
at CBS's cancellation of the popular Sunday evening show. Despite
having finished in the top 10 for nine seasons in a row, the show
was top-heavy with older viewers and weak among the 18- to
34-year-olds coveted by advertisers. The axe fell on the show in
1996.

Such is the fate of many television programs which fail to draw
in young viewers. Advertisers - and the networks that depend on
them - have long sought out the 18 to 34 group as the El Dorado of
marketing demographics. This is in large part due to the view that
younger consumers are more flexible in their brand preferences, and
can be more easily persuaded to try a new brand or product. Older
consumers are considered more calcified in their brand loyalty, and
more difficult to reach. Additionally, in courting
twentysomethings, a marketer is envisioning an extended, lifelong
relationship, whereas older consumers have shorter shelf-lives.

But as 78 million Boomers head toward the 50-plus group, astute
marketers are realizing that the relationship between brand loyalty
and age is rapidly changing, and older consumers will no longer be
as reliably brand-loyal as they have been. "Boomers are going to
rewrite our theories on brand loyalty and older consumers," says
Nat Puccio, executive vice president and director of strategic
planning at McCann-Erickson New York. "Advertisers are going to
have to stop viewing the mature market as a monolithic, stodgy
group who are not interested in new brands or products, and expand
from our youth-obsessed focus."

It's important to recognize that marketers have not been trying
to build brand loyalty in young consumers without doing their
research; many studies have shown that younger people are more
likely to experiment with brands, while older consumers are more
likely to stick with a favorite. Seniors tend to be more brand
loyal because it "simplifies the purchasing process," according to
George Moschis, director of the Center for Mature Consumer Studies
at Georgia State University in Atlanta. A 1997 Roper Starch survey
found that 42 percent of those over 50 "usually did not experiment
with brands" once they found one they liked, compared with 30
percent of those under 50.

Not only have older consumers tended to switch brands less
frequently, they have also long been more loyal to name-brands than
younger consumers. According to the annual DDB Life Style Study, in
1975, 93 percent of Americans in their 70s, and 86 percent in their
60s, said they "tried to stick to well-known brand names." In
comparison, 66 percent of those in their 20s stuck to well-known
brands.

But these same studies have found that brand loyalty is on the
decline among all age groups, and the steepest drops are in the
mature segments. A 2000 Roper survey found that since 1997, the
number of people who did not experiment with brands once they
discovered one they liked, has dropped 7 percentage points to 35
percent among those 50 or older, and 4 percentage points to 26
percent for those under 50. And according to the 2000 DDB Life
Style study, the number of consumers who try to stick with
well-known brands has fallen by 20 percentage points with
seventysomethings, 21 percentage points with sixtysomethings, and 7
percentage points with twentysomethings.

Two of the most important factors in this across-the-board
waning of loyalty were the introduction of generic products in the
late 70s, and the growth of private-label store brands in the 80s,
says Jim Crimmins, worldwide brand planning director at DDB. Ideas
and innovations are easily copied in today's marketplace and many
brands have lost that observable difference that set them apart in
the minds of many consumers. In addition, companies have been
moving an increasing portion of their marketing budgets into
promotion, and away from brand-building advertising, suggesting to
consumers that price is the most significant issue when strolling
supermarket aisles.

There are also important factors unique to generational cohorts
which point toward further erosion of brand loyalty in the mature
market, as Boomers enter that age group. Ann Clurman and J. Walker
Smith point out in their book Rocking the Ages: The Yankelovich
Report on Generational Marketing, that the World War II generation
displays higher levels of brand loyalty due to their early
relationship with brands. "Matures were content to let brands
control," they write, adding that, "the good life of the American
Dream was tied to big brand names." That generation's respect for
authority and conformity meant that brand loyalty was a virtue. The
same cannot be said of Boomers, who thrive on independence and
challenging convention. These people "were rule-breakers from the
get-go, and that applied to brands too," proclaim Clurman and
Smith.

Moreover, older consumers grew up with far fewer brands to
choose from, and therefore, are less inclined to constantly switch
brands. What was important for consumers in the early days of
American consumer culture, was being able to buy any car or
television, not so much whether it was a Chevy or a Ford, GE, or
RCA. As these types of products gained quality parity, and became
affordable to the masses, brand differentiation grew more
important. Accompanied by the growth of the advertising industry,
Boomers were the first brand-focused generation in history, says
McCann's Puccio. "They are the first to have been bombarded with
thousands of television advertisements during their formative
years," he says. "And they have learned to navigate and negotiate,
rather than drown in this world of brands, making them more
demanding of brands, and less loyal."

The affluence of Boomers and the decade-long strength in the
economy has made this group more willing than ever to try new
brands and products, as there is less financial risk involved. A
Roper Starch study found that the number of people 50 and over who
say that "the important thing about a brand is that it gives good
value for the money" has decreased by 9 percentage points over the
past three years. "This age group is usually highly concerned with
value, but their financial strength is making them less so," says
Carrie Chehayl, vice president at Roper. Because many Boomers
intend to keep working well into their retirement years, their
economic situations will be very different from their parents' and
will increase their willingness to experiment with brands.

All these factors make the entry of Boomers into the mature
market an important element in the drop in brand loyalty seen in
this age group. "This is a cohort effect, as Boomers drag down the
loyalty rates of older consumers," says DDB's Crimmins. He adds
that, unlike the generation before them, "we should not assume that
the desire of today's Boomers and younger Americans to stick to
well-known brand names will necessarily increase with age."

This trend presents a major challenge to marketers, as brand
loyalty is an invaluable asset. It can be five times as expensive
to attract a new customer than it is to retain repeat business,
according to Georgia State's Moschis. But this challenge also
presents an opportunity for marketers who can recognize the need to
adapt to the changing landscape of brand loyalty.

A key change will be the need for advertisers to modify their
intense focus on the youth market, in order to become more relevant
to the rapidly growing mature market. It no longer makes sense to
continue to neglect the 50-plus consumer, whose brand loyalty could
be up for grabs. And with the average 50-year-old heading toward 29
more years of life, concerns about building long-term brand
relationships are becoming increasingly dated; the mature years are
the longest life stage a marketer will have with a consumer.

One component that may affect the youth-focus of the advertising
industry is the age of the people who work in it. An American
Demographics study in 1995 found that the average age of account
representatives was 31 from the advertisers side, and 28 on the
agency side. Not only are young people attracted to the advertising
industry, but aging can become an employment issue at times. Twenty
percent of age-discrimination lawsuits filed with the Equal
Employment Opportunity Commission originate in the ad industry,
even though fewer than one-fifth of 1 percent of the U.S. workforce
is employed in that industry.

To help younger employees better understand mature consumers,
one Minneapolis agency that specializes in the mature market, the
Sandcastle Group, runs workshops for new hires, to teach them how
to think "older." Trainees participate in focus groups with a
special panel of mature consumers, who critique their work.
"Because advertising is a youthful industry, we work hard to get
our people to understand the consumer we are targeting," says Kathy
Curry, a mature market strategist at the agency. Curry believes
that as Boomers swell the mature marketplace, more specialized
agencies, or divisions within larger agencies, will spring up, in
much the same way that there are an increasing number of agencies
catering to the black, Hispanic, and gay and lesbian markets.

Marketers should also note that it is during changes in life
stages, such as moving, getting married or divorced, or having
kids, that consumers are most receptive to trying a new brand. For
example, 40 percent of people who move, also change their brands of
toothpaste, according to a study by Moschis. As Boomers have kids,
go back to school, and start new careers at ages their parents
never did, their receptiveness to new brand experiences is greater
than the previous generations.

Customization is another key to winning loyalty, according to
Roper's Chehayl, since Boomers want to be viewed as individuals,
not as a group. Thus, Levi's offers Boomers, who want to hold onto
their youthful love of jeans, the chance to tuck their expanding
waistlines into a custom-made pair.

It's important to remember that despite the fact that Boomers
are fickle and demanding consumers, they are a highly
brand-conscious and brand-aware cohort. "And when a marketer can
make an emotional brand connection with them, it's amazing," says
Puccio. He points to the Volkswagen Beetle as an example of the
long-term affinity for certain brands that can be successfully
instilled in Boomers, who devoured the new model "despite being a
little long in the tooth to be cramming themselves into such a
car."